Idea Cellular’s pure wireless revenue growth was 8.9% qoq and 15.7% yoy. Reported standalone revenue growth was lower at 7.3% as non-mobility, non-service revenues declined meaningfully qoq. Such revenues include handset sales and external revenues from long distance services and leasing owned towers.
Voice traffic grew 5.2% qoq and 12% yoy to 165.2 bn minutes, 1.6%. Idea has reversed the decelerating yoy trajectory on voice volumes in the past couple of quarters. Idea may have grown its voice volumes at nearly 2X market growth rate. MOU for the quarter was 401 min/sub/month, around 1% up both qoq and yoy. Strong voice volume growth reflects sustained market share gains for Idea. Steady MOU performance is also critical in the backdrop of fears on data cannibalizing voice. The increasing data usage would cannibalize voice in select urban pockets only; however, the incumbents have a large rural subs base where MoUs should continue to benefit from network/vintage effect; in addition, we believe that Idea continues to gain quality high-usage subs from competition.
Mobile Data Revenues of Idea
Data revenues grew a strong 23.8% qoq and 85% yoy and formed 11.5% of pure wireless revenues for the quarter. Idea Cellular’s 3G revenues overtook 2G revenues for the first time and formed 52% of Idea’s data revenues for the quarter. 3G data volume growth was a remarkable 148% yoy (and 20% qoq) even as 2G volume growth remained strong at 18% qoq and 125% yoy as well.
SMS/VAS revenues also grew 7.4% for the quarter. Idea added 1,391 2G and 1,114 3G cell sites during the quarter. Indian Telecom remains a sector with difficulties with unique spectrum renewal mechanism is extremely challenging for incumbents. Idea remains the best play given the market share gain potential, corresponding operating leverage, top-notch with Just in Time market execution.